Chapell & Associates

Thursday, March 16, 2006

Debate Heats up Over Net Neutrality

NY Times - March 15, 2006
Speculation that the two biggest phone companies in the country, AT&T and Verizon Communications, are planning to create a tiered Internet system that would require big bandwidth hogs like Google or Yahoo to pay more for their access has become a hot-button issue in the tech industry. Increasingly, it's also an issue on Capitol Hill, where some lawmakers are developing rules to maintain so-called Net neutrality--also called network neutrality--and prevent the emergence of a tiered system.

The Chapell View
I've spoken with many in the Online Retail space about this issue. Many retailers have coalesced around these and other issues into the Online Retail Alliance, which is a subset of the better known Electronic Retailers Association. Led by Bill McClellan, who directs Governmental Affairs for the ERA and ORA, the group has vigorously championed the concept of Net Neutrality.

The fear behind Net Neutrality is that the ISPs are the "keepers of the pipe" that facilitates all Internet traffic. As such, they are in a position to view and potentially exercise control over the data that passes through their pipes. Traditionally, access to those pipes has for the most part, operated under a "one size fits all" approach. So someone like my neighbor, who only checks his email, and once in a while looks at the, doesn't use up much of his ISP's bandwidth. Someone like me, who is looking at streaming video and sending MP3's (of my own original tunes) to friends takes up much more bandwidth. Now the flip side of that equation is that some websites (i.e., the ones that engage in streaming video, audio and other cool stuff) tend to use more bandwidth than others.

The ISPs have started to make noise about charging more for businesses that use more of their bandwidth. So rather than a "one size fits all" model, the ISPs are pushing towards metered approach. Sounds fairly reasonable on its face, right? If you USE more, you PAY more.

The problem with the tiered model is that it puts the ISPs in an even greater position to control the content that comes through their pipes by creating a "pay to play" model. And that has significant implications for the consumer internet economy. If you think this whole AOL/Goodmail system is problematic, wait until you see what happens when that principle is applied to ALL Internet traffic, and not just email.
posted by Alan on Thursday, March 16, 2006 | |

Monday, March 06, 2006

What Would a National Privacy Law Do to Your Marketing?

DM News - March 06, 2006 A Chapell Article
How would national privacy legislation affect your marketing? For anyone who collects or uses consumer information, this is probably a salient question - but perhaps not one that every DMer wants to answer. It shouldn't be surprising that our industry often has seen consumer privacy as a matter for industry self-regulation, and we've defined many guidelines and best practices to that end. But whether we like it or not, we soon may have to accept the government's involvement: Proposals for a national privacy law are gaining ground.(more).

posted by Isaac on Monday, March 06, 2006 | |

Wednesday, March 01, 2006

Internet Users Oppose Storage of Queries

Washington Post - February 22, 2006
Most Americans are uncomfortable with the fact that Internet search engines record their users' queries, according to a survey released Wednesday that examined perceptions about federal authorities' demands for such records. Search engine companies recently sparked the debate by responding differently to the Justice Department's subpoena for records on what their users had been looking up.

The Chapell View
Out of the recent debate over the Justice Departments subpoena of Google, Yahoo! and other search engines requesting past search terms (ostensibly, to verify that a law designed to keep minors away from online pornography is ineffective) comes another controversy: should search engines even be collecting and storing this information in the first place?

CNET added to the controversy by asking search engines about what information they collect and how long they store it about two weeks ago. And Congressman Edward Markey (D-MA) has recently proposed a bill that would limit the ability of any online business to collect and store information about consumers.

Now, as reported by the University of Connecticut, 60 % of Americans say they are opposed to search engines collecting past searches they conduct. At first glance, this may seem somewhat surprising: search terms aren't the most sensitive information, and generally aren't considered personally-identifiable. While it may be possible, given a particular search history, to track down the IP address they come from, the potential harm to consumers seems relatively limited.

The real point may have less to do the sensitivity of the data, though, and more with the data's collection and use. Why? Because for most consumers, the collection itself was unexpected, and they don't have any idea what use the information is being put to. Most search engines state in their privacy policies that they will provide information to government agencies if they are legally impelled to do so - but for many web users, hearing that the Justice Department has subpoenaed search terms may the first time they were made aware that this data was being collected.

Intuitively, consumers may start to think about the 4th Amendment and government searches. If data was being collected, unbeknownst to them, and for a purpose they can't see - and is now accessible by the Justice Department - well, maybe it's less surprising that they're opposed.

Ultimately, it seems somewhat unclear to me whether the subpoena for search terms is in line with the 1986 Electronic Communications Privacy Act, which prevents the government from accessing electronic communications without having gone through the "proper procedures."

The government's argument - in essence - is that web users don't have a reasonable expectation of privacy regarding the search terms they enter into search engines and/or the sites we visit while online. In other words, they argue, they can seize this info. One can only assume that they're basing this argument on the privacy policies submitted by the search engines and/or websites (i.e., we will turn over info to the govt, et cetera).."

Now, if the Justice Department is saying that terms buried in a privacy policy can provide meaningful notice to consumers, it doesn't make much sense for the FTC to tell us - as they often do - that burying similar terms in a privacy policy is deceptive. There's something of a contradiction here: are these statements reasonable notice or not?
posted by Isaac on Wednesday, March 01, 2006 | |

© 2005 by Alan Chapell & Associates LLC